UPDATE 2-European stocks slip as lockdown worries resurface

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* Healthcare stocks rise the most
* Logitech falls from record high after results
* Retailers, miners among big decliners

(Updates to market close)
By Sruthi Shankar
Jan 19 (Reuters) - European stocks slipped on Tuesday,
dragged down by retailers, travel and banking stocks, as the
possible extension of Germany's coronavirus lockdown raised
concerns about the damage to earnings and economic growth.
After gaining almost half a percent at the open, the
pan-European STOXX 600 index .STOXX inched lower as the
session wore on and closed down 0.2%.
Germany's DAX .GDAXI also fell 0.2% even as the ZEW
economic research institute's survey showed investor sentiment
in Europe's largest economy rose by more than expected in
January.
France's CAC 40 .FCHI declined 0.3% and London's FTSE 100
.FTSE slipped 0.1%.
European bourses started the day in optimistic mood over
China's economic strength after data confirmed the world's
second-largest economy was one of the few to grow over 2020.
However, the prospect of longer lockdowns kept investors on
edge as German Chancellor Angela Merkel and state premiers
agreed to extend a lockdown for most shops and schools until
Feb. 14, sources told Reuters. Defensive sectors that tend to be less affected by economic
cycles such as healthcare .SXDP and utilities .SX6P gained,
while retail .SXRP , mining .SXPP and travel and leisure
.SXTP took the biggest hits.
Among the companies that reported quarterly results,
Switzerland's Logitech LOGN.S fell 6.4% after hitting an
all-time high earlier in the wake of raising its 2021 sales
growth and profit outlook. Miner Rio Tinto RIO.L slipped despite reporting a 2.4%
rise in fourth-quarter iron ore shipments, helped by industrial
activity in top consumer China.
As European earnings gather pace, analysts are predicting a
26.2% decline in fourth-quarter profit for companies listed on
the STOXX 600, as per Refinitiv IBES data.
However, the main worry for investors is that an expected
43.5% and 81.1% rebound in first and second quarter earnings
could be called into question as the European economy reels from
the impact of stringent COVID-19 lockdowns. "Going in to the Q4 earnings season investors are more
likely to be concerned with the outlook than historic
performance given that the situation with the virus is changing
so quickly," said Edward Stanford, head of European equity
strategy at HSBC.
"With the prospects for economic growth potentially coming
under pressure, we see a little bit of downward pressure on
consensus earnings for Europe for 2021."
Danone DANO.PA rose 2.7% after an activist investor called
on the French food group's chief executive to step down after it
took a stake in the company late last year. Weighing on the FTSE 100, Ladbrokes owner Entain ENT.L
tumbled 11.9% after U.S. casino operator MGM Resorts MGM.N
ditched plans to buy the British company after it rejected an
$11 billion takeover approach this month.